Pressured by industry fears that its proposed fiduciary rule would limit public access to quality financial advice, the Department of Labor (DOL) has once again delayed its long-gestating redefinition of what constitutes a fiduciary.
In its regulatory agenda published May 23 in the Federal Register, the DOL pushed back the definition from this August to January 2015, conveniently after the November voter referendum on all things Washington.
“With the election, it was completely unsurprising and perhaps good news,” says Knut Rostad, president of the Institute for the Fiduciary Standard. “Fiduciary duty has received a beating in Washington. The outreach strategy needs a reboot; this extra time could prove hugely beneficial.”
The DOL first floated the proposal in 2010, but it was immediately met by a hailstorm of criticism that a broadened definition of fiduciary would drive brokers out of the retirement business and limit advice options for investors with modest accounts, the very people the DOL said it was seeking to help.
The delay also gives DOL Secretary Thomas Perez more time to meet with all affected interest groups, as he promised during his confirmation hearing.
Perez noted, “We’ve been engaged in a significant amount of outreach, and I’ve met with a number of senators and congressmen on both sides of the aisle, and we’re going to continue to do that.”